Exactly sixty days ago – TO THE DAY – a Florida property sold for $85 million. According to the Wall Street Journal, that price set the record for most-expensive non-oceanfront home sale in Palm Beach history. And that made sense because this property is absolutely BONKERS.
I'm trying hard not to oversell this property, but it's totally nuts.
This isn't one of several homes on a private island. It's a private island. In fact, it's the only private island on Palm Beach. The island is accessible by one small private bridge or boat or seaplane. There's no direct access from a normal road.
Words can't really describe it. You must look at this video to get a sense of what we're dealing with:
Known as Tarpon Island, a wealthy private investor named William Toll, and wife Eileen, bought this 2.5-acre property in 1998 for $7.6 million. If William and Eileen are reading this article, I have some good news and some bad news.
The good news: Sixty days ago you clocked in a $77.4 million gain on the property you called home for two decades.
The bad news: Had you waited another month, you theoretically could have clocked a $112.4 million profit.
The buyers who paid the Tolls $85 million back in July are a development group led by a high-end developer named Todd Michael Glaser and investor named Jim Randall. We mentioned Todd Glaser back in November when he paid $22 million for Jeffrey Epstein's former Palm Beach mansion (he proceeded to demolish the structure). According to therealdeal.com, Todd and Jim took out a $50 million mortgage to buy Tarpon, putting down $35 million in cash from their own pockets.
In an interesting twist, today it was revealed that Todd and Jim are putting the home back on the market for…
It's been sixty days.
If they get $120 million, that would constitute a $35 million payday for basically no work.
Let's say Todd and Jim actually get their asking price and it takes a month for the deal to close. In that 90 days they would have made three mortgage payments. A $50 million at 3% interest equates to a $210,000 monthly mortgage. So let's assume they paid around $630,000 in mortgage payments.
Even with that payment and some generous assumptions for maintenance, they would be clocking in a $34 million gain in 90 days. That equates to $377,000 per day of ownership.
Todd and Jim have already begun formulating renovation plans so they have an alternate option for potential buyers. You can either buy the island as-is for $120 million. ORRR, for $200 million you can buy the island and have Todd and Jim continue with their development plans.
The existing 9,700 square-foot home was built in 1930 and features 5 bedrooms, 9 bathrooms. As you can see from the video, the property features a tennis court and pool. Todd and Jim apparently have plans to expand the property to 25,000 square feet with 14 bedrooms and a new larger pool.
Something crazy is definitely going on in the Florida real estate market. Just last week we told the story of Birdman's former Miami mansion. Birdman sold the home a year ago for $10.85 million, a roughly $3 million loss from the price he paid several years earlier. The new owner performed some moderate renovations and just listed it, one year later, for $34 million.
I think I need to get into the Florida home flipping market!